Analysis of Economic and Legal Context in Financial Planning FPC001B

This assignment, focused on the Economic and Legal Context for Financial Planning (FPC001B) course, requires students to analyze the impact of economic variables and government policies on financial planning decisions. Question 1, worth 20 marks, necessitates a detailed examination of factors such as labor market conditions, interest rates, global economic influences, local property market conditions, and equity market performance, and how these impact a client's investment objectives. Students are required to describe each factor, explain its influence on an investment objective, and discuss the impact of monetary and fiscal policy changes. Question 2, worth 10 marks, involves legal and regulatory research, specifically focusing on the Corporations Act 2001 and ASIC regulations. Students must locate and summarize section 942C of the Corporations Act, analyze a relevant case involving Ostrava Equities Pty Ltd, and identify relevant ASIC Regulatory Guides (RG). The assignment emphasizes the importance of understanding both economic and legal frameworks in financial planning. The solution provided here covers all aspects, including the case study analysis and legal research components, demonstrating a strong understanding of the course material.

Economic and Legal Context for Financial Planning
(FPC001B)
Analysis Task
Total marks: 30
Instructions to students
This analysis task covers Topics 1, 2 and 3, and accounts for 15% of your final grade.
Due date: You must ensure that you submit your Analysis Task by the due date. Late submissions will not be
accepted.
You will need to answer two (2) questions:
Question 1 is based on the case study located on the assessment page.
Question 2 requires you to undertake legal and regulatory research.
This task specifically addresses the following subject learning outcomes:
1. Explore the role of intermediaries in financial markets.
2. Explain the impact of current issues and key economic and financial indicators on the Australian and
global financial markets.
3. Analyse the impact of government and monetary policy on the Australian financial markets.
5. Explore the main sources of law and the regulatory structure of financial services law in Australia.

Question 1 (20 marks| Word limit: 750)
Impact of economic variables and government policiesNote: Please refer to the case study to answer the question below.
The case study mentions five (5) factors that Jane is concerned about.
For each factor listed, you are required to provide:
1. A description of the factor, covering the current market environment applicable to that factor.
2. A focused explanation of how that factor has an influence on one (1) of Jane’s investment objectives
of your choosing.
3. In general terms, an explanation of how monetary and fiscal policy changes could also influence the
chosen objective.Hints:
• Your answer should have five parts – one for each factor mentioned in the case study.
• Each factor/part should then be broken down into the elements 1-3 above; accordingly. For full marks,
you will need to provide 5 lots of 3 elements (15 elements total) in your answer.
• You should note the word limit and apply the limit evenly across the five factors.
• As the focus in the question is on economic and financial policy, do not attempt to answer the question
as if you were wearing a lending banker’s hat. No actual borrowing advice or financial calculations are
required. The question is about the impact of economic variables and government policies, including
fiscal policy.Note: Marks are awarded for justification and research into the relevant topics.
Criteria-based Marking Guide for Question 1
Excellent (Mark range: 15–20 marks) Satisfactory (Mark range: 10–14.5
marks)
Unsatisfactory (Mark range: 0–9.5 marks)
• clear and concise description of each
factor, including current conditions and
expectations
• excellent understanding shown of how
each factor impacts or influences one or
more of the client objectives
• sound analysis of the influence of
central bank and government policy on
each of the factors
• evidence of external research with
appropriate references
• adequate description of each factor
• reasonable understanding shown of
how the factors impact or influence
the client objectives
• some analysis of the influence of
government policy on each of the
factors
• some evidence of external research
• incorrect or little description of factors
• poor understanding shown of how the
factors impact or influence the client
objectives
• little analysis of the influence of
government policy on each of the factors
• little or no evidence of external research
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **

Insert your answers to Question 1 below this line
Labour Market Conditions
 The current labour market conditions in Australia depict the overall growth but there is a fall in the
real estate services in the market. There is a boom in the rate of employment in the economy, but a
drop in particular to the real estate labours (Australian Government, 2019).
 The influential outcome of this analysis is the labours there are moving jobless, but the rates are
high. As an impact, the available market conditions make the positive impact to hire the labour for
the construction services. The person may also find the problem in searching of labours in the
available market scenario.
 The monetary policy is here important to cover up the deviation in the economic market. The more
money in the market with the people will motivate to work improving the market conditions. The
Monterey issues can be raised with the efforts of the government and non-government
organisations.
Interest Rate Environment
 The existing interest rate environment in Australian market showcases the cash rate unchanged at
1% as to maintain the economic growth and cash balances in the market. This year the central bank
has reduced the interest rates for loans, due to the subdued inflation rate resulted the ease in
monetary flow (RBA, 2019).
 The current interest rate is in favour of Jane concerning the ease in the flow of cash in the market.
The Jane now can expand on various factors used up in the construction of the property. The
benefit of risk distribution is also availed in the current economic market of Australia.
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **

 The ease in the flow of money under monetary policy in the government makes the decision strong
to buy the house property by Jane. The option to save or invest the available with her makes to opt
for the investment with the prevailing low rate of bank interest in the market.
Global Economic influences on the Australian economy
 Globally the economic factors have impacted the economy factors and in Australian market as well.
The factors cited can be the slowdown of Chinese Economy and the downfall in the international
trade of goods and services across the international boundaries. These two boomed concerned
effected Australian Market which slowed down the growth in Australia (Lowe, 2019).
 The concern of Jane for buying a new with the international trade down market, she can buy the
property with the low price in the market. The fallen prices in the market lead to the profit of the
Jane in buying the house property in Australian market.
 Impacting the current economic market of Australia the flow of the financial money is being cut
down due to the cut in the interest of the people in the monetary policy environment. The short
fall of trade in the market makes the restricted flow of the market in the economy.
Local Property market conditions
 Currently the property market segment in Australia has changed over a past month, due to the
Federal election, the falling rates of interest and Australian Prudential Regulation Authority (APRA)
releasing the restrictions in the global market. The fall in the prices in the property values is
continuing since January, 2009 (Yardney, 2019).
 The effect of this market conditions in Australia, Jane can purchase the house property with the
lower price and can utilise the rest amount in the hands for the innovation and to the other related
expenditure.
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **

 Analysing the current scenario, there occur the situation of deflation in the Australian economy.
The government should consider the monetary policy, majorly the cash rates in the market to go
with the treatment of the deflating policies in the market. Government and Reserve Bank of
Australia both can serve the deviation related to the financial conditions.
Global and domestic equity market performance
 The Australian equity market is most one the high profile and important among the financial
markets. The total capitalisation listed was under $2 trillion. This also impacts the share of output
and employment, reflecting the major correlation between Australian Market and economic
activities (Mathews, 2019).
 The positive impact of the raise of the share market also affects the employment rate in the
Australian economy. This can make the resources bit costly in nature, Jane may have to spend extra
in relation to the other factors. With the strong factors in the economy the profits and impacts in
positive aspect may rise.
The strong and efficient structure of Australian market structure defines the positive working in
environment. This also builds up the strong and efficient bond in the global market with respect to the
working in the Australian market.
End of answers to Question 1
Question 2 (10 marks| Word limit: 600 words)
Finding the law
As outlined in Topic 3, accessing legislation and the law is a relevant skill for people working in financial
services. For this question, use online legal resources to locate the following information.
(a) Find section 942C of the Corporations Act, and provide:
(i) the full text of the heading of the section, and the online address (hyperlink) and date you
accessed it (1 mark)
(ii) a brief summary of the purpose of the section (1 mark)
(iii) the penalty applicable for a breach of section 942C(8). (1 mark)
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **

(b) In Austlii, locate the 2016 case involving Ostrava Equities Pty Ltd and provide the following details:
(i) the full case citation (1 mark)
(ii) the wording of the court’s findings in relation to the first defendant and their contravention of
section 942C of the Corporations Act (1 marks)
(iii) the orders which were sought by ASIC in 2016 that formed part of the reasons for judgment.
(2 marks)
(c) Find and provide the following:
(i) the correct Harvard style citation of the ASIC Regulatory Guide (RG) that provides guidance to
practitioners on how section 942C applies, including online address (hyperlink) and the date
you accessed it (1 marks)
(ii) from the relevant ASIC Regulatory Guide (RG), quote two ways in which a financial services
guide may be provided (include the RG section references). (2 marks)
Criteria-based Marking Guide for Question 2
For this research and referencing activity, responses which are correct and complete will be awarded full
marks. Partly complete and correct responses may attract part marks.
Insert your answers to Question 2 below this line
Corporation Act, 2001
According to Australian Corporations Act, 2001 it lays down the complete procedure and complied rules
and policies from its commencement to its daily routine. There is an ease in the working and improvement
in the working of the organisation.
a. 942C of the Corporations Act, 2001
i. Full text heading-Financial Services Guide given by authorised representative--main
requirements
Webpage Link- http://www8.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/
ca2001172/s942c.html
Date of Access- September 13, 2019
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **

ii. Brief Summary- the Corporations act 2001 deals with the laws in associated to the business
entities or enterprise in Australia at national or state level. The act is primary is based on
the Australian Corporations Law. This law is all related to the formation and the process
involved in the operation, duties of the members and the officers, takeovers and the frauds
in the corporations. It defines the process, rules and regulations of the organisations
incorporated under this act.
iii. With the breach in this Act, in the associated party implies the penalty in regard to the
shortfall of 5 Penalty points or the imprisonment of complete one year (World Intellectual
Property Organization, 2015).
b. Ostrava Equities Pty Ltd and ASIC
i.
Australian Securities and Investments Commission v Ostrava Equities Pty Ltd [2016] FCA
1064
ii. In the words of the judge the result to the case of the Ostrava Equities Pty Ltd vs ASIC the
outcome is in relation to the two points:
1.Provided that Richard Stringer in 2014 February and William Tobin in 2010 in
accordance with the financial services norms and guide that was absent from the
present and required time in the manner of the Section 942C (5),
2.Secondly, the decision regarding to financial services guide to the clients WP and KE
during the working of the case say January 2014 was not dated as per the
requirement stated in the Section 942C (5), again with the absence of detailed
statement which was the requirement of the Section 942C (3), the necessity stated
in the Section 942C (6A) was not clearly, concisely and effectively presented
(Federal Court of Australia, 2016).
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **

iii. The amendments taken in April 2016 in the process to link with Equity Capital Partners as
Defendant and to fetch the declarations of contraventions of the two acts, ASIC and
Corporations Act. Proceeding further in June 2016, there was an agreed statement
representing various parties, Mr Grimm, ASCI, Mr Ash, and Equity Partner Capital. This
agreement was processed on the grounds of the above stated members and Ostrava
Equities, Ostrava Securities and Ostrava Asset Management, with the act National
Consumer Credit Protection Act 2009 (Cth) and Corporations Act,2001 (austlii, 2019). It
also includes the wind up of each corporate defendant, commands to stop Grimm and Ash
from carrying out the financial operations in lieu of 20 years and 10 years respectively, and
disqualified action of practicing corporations for period of 15 years and 7 years (Federal
Legislation of Australia , 2019).
c. Financial Regulatory Guide (FSG)
i. Online Citation: REGULATORY GUIDE 175 Licensing: Financial product advisers—Conduct
and disclosure November 2017
Link on Web: https://download.asic.gov.au/media/4698465/rg175-published-10-april-
2018.pdf
Date of Access- September 13, 2019
ii. The reason for the application of the Financial Service Guides is to up keep the clients
with the changed and new applicable laws and regulations in the process of operating in
the business world. Financial Service Guides are to be implied to the client in directly or
indirectly basis constrain of the fact based on Corporation norms and policies. The floor on
which Financial Service Guides are to be followed can be on the primary authorized
representatives and the required licensees in the operating of financial services on the
behalf of the serving clients.
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **

End of answers to Question 2
END OF ANALYSIS TASK
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **

Bibliography
austlii, 2019.
NATIONAL CONSUMER CREDIT PROTECTION ACT 2009. [Online]
Available at: http://www6.austlii.edu.au/cgi-bin/viewdb/au/legis/cth/consol_act/nccpa2009377/
[Accessed 14 September 2019].
Australian Government, 2019.
Australian Labour Market Update—July 2019. [Online]
Available at: https://docs.employment.gov.au/system/files/doc/other/almu_july_2019.pdf
[Accessed 14 September 2019].
Federal Court of Australia, 2016.
Australian Securities and Investments Commission v Ostrava Equities Pty
Ltd [2016]. [Online]
Available at: http://www6.austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/FCA/2016/1064.html?
context=1;query=ostrava;mask_path=au/cases/cth/FCA
[Accessed Thursday September 2019].
Federal Legislation of Australia , 2019.
DISCLOSURE REQUIREMENTS. [Online]
Available at: http://archive.treasury.gov.au/documents/272/PDF/ch06.pdf
[Accessed Thursday September 2019].
Lowe, P., 2019.
The Economic Outlook and Monetary Policy. [Online]
Available at: https://www.rba.gov.au/speeches/2019/sp-gov-2019-05-21.html
[Accessed 14 September 2019].
Mathews, T., 2019.
The Australian Equity Market over the Past Century. [Online]
Available at: https://www.rba.gov.au/publications/bulletin/2019/jun/the-australian-equity-market-over-
the-past-century.html
[Accessed 14 September 2019].
RBA, 2019.
Statement by Philip Lowe, Governor: Monetary Policy Decision. [Online]
Available at: https://www.rba.gov.au/media-releases/2019/mr-19-23.html
[Accessed 14 September 2019].
World Intellectual Property Organization, 2015.
Companies Act 2001. [Online]
Available at: https://www.wipo.int/edocs/lexdocs/laws/en/au/au404en-part5.pdf
[Accessed Thursday September 2019].
Yardney, M., 2019.
State by state: A June update on Australia’s property markets. [Online]
[Accessed 14 September 2019].
For office use only
# 1 2a(i) 2a(ii) 2a(iii) 2b(i) 2b(ii) 2b(iii) 2c(i) 2c(ii) TOTAL
Max 20 1 1 1 1 1 2 1 2 30
Awarded x
x x x x x x x x **
Expression is
faulty **